The Consulate General of Spain in Havana has a contract with the Employment Company PALCO, a Cuban state entity subordinate to the Council of Ministers, which allows the company to accept or reject workers proposed by the Spanish authorities.
This authority, expressly stated in the supply contract for workforce signed between both parties, grants the Cuban-regime company a veto power over the hiring of local personnel at the consular office.
The document, signed on January 1, 2025, by the then Consul General Antonio Álvarez Barthe and the General Director of PALCO, Rubén Santiesteban Ferrás, corresponds to file 2024SWs00114. The contract was awarded for 1,131,295.68 euros, has an initial duration of four years, and includes the provision of office personnel and general services.
Clause 3.9 of the contract states that the Consulate may propose any candidate to fill the available positions, but PALCO "may supply them or not." The document specifies that as long as the Cuban state company does not accept the proposed personnel, they cannot provide services to the Spanish authorities.
This means that the selection of a worker by the Consulate does not guarantee their incorporation, as PALCO retains the right to reject them, even if they have been chosen by the Spanish diplomatic representation.
For its part, clause 2.1 establishes that the Consulate may only use the services of Cuban workers or foreign permanent residents on the island when they have previously established an employment relationship with PALCO. Moreover, clause 3.3 stipulates that the positions and functions must be agreed upon by both parties, and any change of specialty must be communicated to the employing company.
The contract also governs the withdrawal and termination of employees, although these powers do not belong exclusively to PALCO.
Clause 3.10 allows the state company to terminate the employment relationship and withdraw the provided personnel for duly justified reasons, provided that it communicates its decision to the Consulate at least 30 calendar days in advance.
However, clauses 3.8 and 3.11 also grant powers to Spanish authorities. The Consulate may decide to dismiss an employee with the established notice period and, in cases of negligence, misconduct, or other causes attributable to the employee, request their immediate termination without having to compensate PALCO.
Therefore, the Cuban company does not have exclusive control over the retention of personnel, but it does retain a decisive authority over their incorporation: no candidate proposed by Spain may begin work under this contract if PALCO decides not to accept them.
This provision highlights the dependence of the Spanish Consulate on a labor intermediation mechanism controlled by the Cuban State, even when it concerns individuals chosen by the Spanish authorities themselves.
The Sánchez government defends the contracting with PALCO
The Government of Pedro Sánchez officially acknowledged the hiring of personnel through PALCO in a response to the Congress of Deputies dated September 23, 2026, following a written question submitted by deputies from the Popular Party.
In his response, the executive stated that the personnel provided by the Cuban company carry out administrative, technical, and support functions "under the direction and supervision of the officials at the Consular Office."
He also stated that those employees "under no circumstances" perform functions reserved for Spanish public officials nor participate in the decision-making process regarding civil registration files, passports, or visas.
However, the parliamentary response does not elaborate on the powers that the contract grants to PALCO to reject candidates proposed by the Consulate, which is a different issue from the oversight of the tasks performed by the workers once they are hired.
While the Spanish authorities maintain control over day-to-day operations and decisions regarding consular files, the Cuban company is required to intervene in the hiring process and can prevent the inclusion of candidates selected by Spain.
The executive also did not detail in that response the specific mechanisms used to verify the suitability of the personnel provided by PALCO, nor the procedures applicable when Spanish authorities raise objections regarding certain workers.
The government justified state intervention by invoking Decree-Law 384 of 2019, which regulated the hiring of local personnel for foreign representations in Cuba.
According to the explanation, this practice has been in use since 2017 and is a requirement of Cuban legislation, which mandates that diplomatic missions resort to state-owned employment agencies.
The contract reveals how much PALCO charges and how much the workers are paid
Another relevant aspect of the original document appears in its annexes, which identify the job positions, monthly work hours, the cost of the service billed by PALCO, and the agreed salaries for the employees.
For example, for an office assistant, the contract stipulates a monthly service cost of 5,822.47 Cuban pesos (CUP), while the agreed monthly salary for the worker amounts to 3,706.69 CUP.
The difference is 2,115.78 CUP per month per employee, which is approximately 36.3% of the amount that PALCO charges for that service.
In the case of the general service assistants, the annexes specify a monthly cost of 5,702.57 CUP and an agreed salary of 3,630.14 CUP, which results in a difference of 2,072.43 CUP.
These figures, included in the contract itself, show that the state-owned company receives an amount greater than the agreed-upon remuneration for each worker, although the document does not clarify what portion of that difference corresponds to management expenses, labor obligations, or other concepts.
The labor intermediation system was also the subject of investigations by the Spanish press, which questioned the discrepancy between the payments made by the Spanish authorities and the wages ultimately received by Cuban employees.
The workers of PALCO and the files of the Grandchildren's Law
The significance of these clauses is particularly important due to the volume of personal documentation handled by the Consulate General of Spain in Havana.
The consular office has received over 350,000 applications for Spanish citizenship under the Democratic Memory Law, known as the Grandchildren’s Law, a process that requires the processing of birth certificates, family certificates, identity documents, and other personal information from the applicants.
To address the flood of files, Spain turned to personnel provided by PALCO, a company that benefits from the labor intermediation system established by Cuban authorities.
The Popular Party raised questions to the Government regarding the physical and IT access of those workers to the files and about the possible connections of the company with the military conglomerate GAESA, controlled by the Revolutionary Armed Forces.
In its parliamentary response, the Executive assured that access to documents and information systems is limited to service needs and subject to authorization, supervision, and traceability mechanisms.
He also stated that staff must comply with confidentiality obligations and the current regulations regarding data protection and information security.
However, the response does not specify the concrete access levels for each category of employee nor does it detail the individual verifications conducted prior to their onboarding.
The existence of these contractual powers does not demonstrate that PALCO or the Cuban authorities have improperly accessed nationality files. However, it raises questions about the controls applied to workers whose hiring depends on a foreign state-owned enterprise.
The controversy surrounding the Grandchildren's Law has also extended into the electoral arena. This Monday, the Spanish Supreme Court rejected a petition from the State Attorney's Office and upheld the precautionary suspension of voting for certain individuals naturalized under this law in the upcoming general elections on November 29. This measure could affect 163,020 voters, although it does not involve the loss of Spanish nationality nor does it allow for determining how many of those affected are Cuban.
PALCO and its ties to the Cuban state apparatus
Grupo PALCO is a Cuban state entity under the Council of Ministers, dedicated to providing services to government agencies, diplomatic representations, and foreign entities.
The company has been linked to the economic network associated with GAESA, the business conglomerate controlled by the Cuban Armed Forces and subject to U.S. sanctions.
His career has also been surrounded by controversies. In October 2024, the group's name came up in connection with reports of an investigation into alleged financial irregularities involving Yoel Perdomo Di-Lella, brother of the then deputy prime minister Jorge Luis Perdomo Di-Lella, dismissed that same month.
In the case of the Spanish Consulate, the main question lies not only in the public funds allocated to the Cuban state enterprise but also in the powers it retains regarding the hiring of workers at the diplomatic mission.
Although Spain maintains oversight of consular functions, it retains the authority to decide on the dismissal of employees and is responsible for nationality files, the contract allows PALCO to reject candidates proposed by the Spanish authorities.
In this way, the operation of the Consulate relies on a Cuban state company for the hiring of local staff, which can prevent the hiring of workers even when they have been selected by the Spanish diplomatic representation itself.
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